Adam Smith, the father of economics, published The Wealth of Nations in 1776. Although it made little impact in its time, it conceptualised the economy in a radical new way: in terms of individual agents, acting out of self-interest. From an individualist perspective, he argued that people produced goods in order to make money, and made money in order to purchase goods they valued most. The exchange takes place in a market, where prices are set according to costs and the demand for the good. This was a self-regulating system which he described it as being controlled "as if by an invisible hand". In his system, labour was the final measure of valuewages (a cost) based on the needs of the worker, and rent on the productivity of land. The market acted as a communicator and coordinator (via prices), and a motivator for individuals, such that general welfare was achieved. Another important observation was that the division of labour into specialised functions allowed for far greater production than a single worker creating the entire product from start to finish (his example was from observing produciton in a pin factory). As a consequence, he saw taxes as a distortion of prices, and thus an obstruction to the general welfare that the market could provide, if unhindered. At the same time, he allowed that there were things for which the market couldn't accomodate for (roads, sanitation, known as public goods), and which a minimal government should provide. Later economists built on this idea that there may be goods with externalities (positive or negative), that is side effects from their consumption or production. Next, we have Karl Marx, who conceived of history as a struggle between different types of class. Class was defined according to the relations in the forces of productionthose in a higher position could exploit those lower. In the feudal mode of production, the lords did not directly control the tools or lands of the peasant, but had control over the...

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...AdamSmith and KarlMarxAdamSmith and KarlMarx have very different theoretical contributions. AdamSmith proposed that the free market, where producers are free to produce as much as they want and charge customers the prices they want, would result in the most efficient economic outcome for consumers and producers alike due to the. The rationale for his proposal was that each individual would try to maximize his own benefit. In doing so, consumers would only pay as much as or less than they would value the benefit that a good could provide, and producers would only sell for as much as or higher than they would have spent on producing a good. In his optimistic economy, there would be no surplus or demand; markets would always be in equilibrium, and the benefits to consumers and producers alike would be maximized. There would be a limited role for the government in such an economic system.
In contrast, Karl Marxl reasoned that workers would be broken by any capitalist, or factory owners, because he believed that a capitalist system provides an advantage for the rich and a disadvantage for the poor. The rich would get richer and the poor would get poorer. Furthermore, the “capitalist” is always in a better position to negotiate a low wage for his workers, he argued. One of his notable and more arguable theories claims...

...﻿ AdamSmith versus KarlMarx, this could quickly turn into a debate between the ideas of capitalism and the ideas of socialism. Without these two great economists the industrial revolution would not have been what it is nor would it have the impact that it had on the society. It was the ideologies of AdamSmith that influenced and brought change into the one dimensional feudal society, to a dynamic capitalist society. In the book “The Wealth Of Nations” AdamSmith emphasizes on the importance of division of labour and capital accumulation, in order to increase efficiency and productivity within a society. Through these two concepts, a society can fully utilize its resources and excel as a nation.
“THE GREATEST IMPROVEMENTS in the productive powers of labour, and the greater part of the skill, dexterity, and judgment, with which it is anywhere directed, or applied, seem to have been the effects of the division of labour”(Smith,10).Smith rapidly makes this concrete by giving the example of a pin factory where of course pins are being produced. He stresses just how much this work is divided up into different branches and operations and that no one person can come close of doing all that work themselves. It’s not just a matter of the one person not having enough time to do all those task but there are more fundamental...

...AdamSmith and KarlMarx are both respected in their views for creating a society in which it will allow for the greatest number of people to flourish under the conditions of their type of government. AdamSmith, a Scottish political economist philosopher born in 1723, had the goal of impeccable liberty for all individuals through the capitalistic approach, in which he argues that capitalism will not only create new wealth and the possibility for universal opulence and future happiness, but improves the moral fiber of an entire nation. While KarlMarx, born in 1818, believed in individual freedom for society and logically criticized capitalism giving reasons as to why it was it was an immoral and evil economic system that will ultimately be overthrown. Figuring out what kind of state will ensure the greatest freedom or liberty of individuals was their main philosophical problem. They differed in their views of human nature, the social decisions made in the society, the role of competition, and the effects of the division of labor on human beings.
In Smith’s notion of human nature, Smith suggests that it is better to be rich than to be poor, but he focused on making a decent life possible for all. He felt that a market economy was best able to improve the standard of living of the vast majority of the population; that it would lead to what...

...The theory of Marxism is superior on paper, but impossible in reality, while capitalism as presented by Smith is more suited for the real world economic practices. KarlMarx was the creator of Marxism and was a Hegelian at first, but his views where converted later on to communism and further on into his own Marxist beliefs. His beliefs held the fact that money is what alienates people, and that religion is insignificant. AdamSmith is the creator of capitalism in a sense. Many people contributed to his beliefs which outline the fact that the market should comprised only of small buyers and sellers; that way no entity is too large to influence price. This way everyone would benefit, but this will be explained later on. He also felt that the government was in place to serve the rich with its tax laws.
KarlMarx was born in1818, in Tier Germany. His parents originally Jewish converted to protestant to make life easier for Karl's father to practice law. Marx's education started in the University of Bonn, but was sent to the university of Berlin after he was arrested for drunkenness and his father felt it would be better for him. In Berlin he switched from law to philosophy, and oddly enough it was his father's death that put the thought of getting a job into Marx's head. After university his interests turned to journalism, he first worked for a liberal newspaper, but after...

...AdamSmith and KarlMarx
Modern political economic theory and philosophy can be greatly attributed to the works of two men who seemingly held polar opposite views on the subject. AdamSmith, a Scottish philosopher, published his most well known work An Inquiry into the Nature and Causes of the Wealth of Nations in 1776 and is most often associated with the ideas and principles of the political economic system known as Capitalism. At the other end of the spectrum is KarlMarx; the German philosopher most often associated with Communism and the author (or co-author) of The Communist Manifesto. This paper seeks to discuss the core differences in their respective political economic philosophies with regards to what economic value is and what the role of government should be in their versions of political economy. This will conclude with the argument that while Smith's work had laid the foundation for modern economic philosophy, it was Marx who would ultimately leave the most significant impression upon the world with his revolutionary ideas.
An Inquiry into the Nature and Causes of the Wealth of Nations (commonly abbreviated as The Wealth of Nations) is considered to be the first full treatment on the study of Economics. This work essentially lays the foundation for the economic system known as Capitalism. Interestingly enough, Capitalism was...

...The ideologies of KarlMarx and AdamSmith would be compared to that of socialism and democracy today; complete government control verses little government control. These two men were completely opposite in their ideologies. As history plays out, it is clear that Marx’s ideologies led to communist control and extremely harsh conditions for the people. Smith’s ideas, on the other hand, encouraged capitalism and growth in the western world.
The Marx system supported government control over everything from land ownership and production to owning property and banking. This system would give all control to the state with no local or individual control and ownership. His ideas were supposed to establish democracy: “A government by the people ruled of the majority with representation of the people through elections.” The Marx system was far from a democratic system and eventually led to the complete opposite, communism.
In sharp contrast, the Laissez-Faire economics that AdamSmith supported and believed government should not interfere in the free operation of the economy. It supported Free- enterprise with markets producing more goods and making them affordable to all. Capital goods and investments would be privately owned rather than state controlled. The belief of free enterprise would promote general well fare for all. The government would take measures to...

...AdamSmith and KarlMarx are the greatest economic analysts the world has ever seen. AdamSmith is considered as the father of modern day economics whereas KarlMarx is considered as the father of Communism. KarlMarx is one of the most controversial figures of the twentieth century, though he lived in the 19th. As one of the original minds behind communism and a fundamental revolutionary, he is renowned as a radical and somewhat dangerous political philosopher. AdamSmith is the father of economics as a science. As a member of the school of classical economic thought, Smith fused economics with moral theory regarding the way man ought to live. Smith’s explanations of market forces and the role of the state in economics have shaped our capitalist economic system today. These men have together been placed in the school of classical economics, signaling that there are similarities in their ideology. Politically, however, these men differ greatly.
AdamSmith believed in the liberty of all individuals through a capitalistic approach. Smith argued that capital for the production and distribution of wealth could work most effectively in the absence of government interference. Such a laissez-faire—that is, “leave alone” or “allow to be”— a term he spoke...

...﻿AdamSmith and KarlMarx Difference essay
They were both known for their distinct theoretical contributions. AdamSmith proposed that there should be a free market where the producers are free to produce as much as they want and charge buyers the prices that they want. He thought that this would result in the most efficient and desirable economic outcome for consumers and producers. This meant that the consumers would only pay as much or less than they would value the benefit from the good, and the producer would only sell for as much as or higher than they would have spent on making the product. The market would always be equilibrium. There would only be a limited role for the government in the economic system. KarlMarx disagreed and thought that workers would have an advantage because they are already rich and there would be a disadvantage to the poor. The rich would only get richer and the poor would only get poorer. He came out with a theory called the labor theory of value. The claims that the value of a good or service is directly connected to the amount of labor required for its production. Marx thought that the two classes in society, the bourgeoisie and the proletariat, will remain stuck in their respective classes because of the very nature of capitalism. The wealthy bourgeoisie owns the factories and also dominates the...